Performance Overview

Angostura Holdings Limited reported strong first quarter results for the three-month period ending March 31, 2020. In the first quarter of this fiscal year, profit before tax grew by 9% or $1.7m over that of Ql 2019.

The Bitters segment reported the largest segment growth over the comparative period last year of 42% or $11m, due to increased sales in the USA, UK and South Africa, which offset the decline in the Australian market. This is in keeping with the company’s strategic target for growth and expansion in foreign markets.

Local rum revenue grew by 8% or $6.4m as the market acceptance of new flavoured rum blends, particularly White Oak Sorrel, continued into January 2020. In that month, we added White Oak Coconut to the portfolio which gained momentum over Carnival 2020.

The impact of rejuvenated marketing campaigns for LLB is clearly seen by the increase in revenues from that segment, up 56% or $2.3m over the comparative period last year. This was directly due to increased demand locally and throughout the Caribbean.

While we continue the prudent management of costs and capital outlay, we are also mindful of the need to ensure production efficiency and effectiveness. In this regard, we continue the repair works required to the waste water treatment plant. For this, our production volumes have temporarily declined, leading to an increased cost of production and overall increase in cost of goods sold by 3% over Ql 2019. Despite this, due to the product mix of revenue growth, overall gross profit margin for the three-month period ending March 31, 2020 was 52% compared to 47% for the same period ending March 31, 2019.

The Group’s profit margins were impacted by increased operating expenses of 17.6% or $8.6m over the comparative period, as well as foreign exchange losses incurred in Ql 2020 due to devaluation of major foreign currencies as a direct result of the global economic impact of COVID-19.

Fiscal 2020 was off to a promising start, but we are mindful that the COVID-19 pandemic is likely to impact our local and foreign demand, supply chain and distribution, and the time required to complete improvement and repair to our waste water treatment plant. We are not daunted. Angostura will continue to innovate and be proactive so as to conduct its operations in a manner that takes account of the changing local and global market as the months unfold in these unprecedented times.

We take this opportunity to commend our staff for their contribution of time and tangibles to the benefit of other frontline workers and persons affected economically, socially and financially by the impact of the pandemic.

Mr. Terrence Bharath
Chairman
May 4, 2020